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You look forward to an invoice factoring financing company hoping for a hassle-free experience and a faster cash in hand timing. The method is the most popular when businesses are looking help with their cash flow needs. However, there is much more than what you can expect from your factoring company.

A factoring company can be helpful for a business in more than one way. Besides funding accounts receivables, factoring companies can help with the following:

Establish your customer’s creditworthiness – Invoice factoring companies have the credit history of most of the clients associated with your business. This means, if you are unsure about dealing with a particular customer, you can run a detailed background check with the help of your factoring company and know if the client is suitable for long-term business. You can gain insight about different clients in your market and choose to do business with them wisely

Reassurances of not having long-term contracts – Long-term contracts are something not every business wants to get stuck to. Businesses find it difficult to manage invoices that are due for many days. With the help of a factoring company, they don’t have to get into dealing with different kinds of clients. All they need is to factor the invoice, and rest assured, they don’t need to worry about long-term contracts whatsoever.

Factor if need be – Not all invoices do you need to factor. This information can be achieved only with the help of a factoring service provider. Just because you factor most invoices doesn’t mean that you have to factor all of them. It is highly likely that certain invoices can be paid instantaneously by your customers and there is no waiting period.

Thus, before considering your invoices for discount financing, get the status of payment date of the invoice with the help of the factoring company. If the payment date is arriving soon, you can submit the invoice directly to the client instead of discounting the same. Thus, you can factor only when you have to..

Invoice factoring services can be availed for a variety of other purposes. With the help of right company, you can save a lot on your invoices. Also, you could gain insight on various topics that can help you take wise business decisions. In fact, the best business advice can be achieved from those who know the market inside out. The benefits you can avail from your money lender is immense, provided you ask.

In 1985, 1st PMF Bancorp was founded as a family run lender providing factoring, but as our clients’ businesses expanded globally, PMF Bancorp expanded its services to provide credit and financing support for our clients domestic as well as international business needs.

In an ideal world we all would like to have enough money for each of our requirements; wherein there is never a need to visit a lender to meet the cash gaps. It sounds too much of convenience and happy living. Isn’t? However the reality is not that sweet and most of us have little choice in the financial matters. We have a multibillion lending industry thriving on the vast gap between the consumer needs for credit, after all.

With the advent of FinTech industry it has become easier than ever to borrow the required funds, say, in a matter of few hours you can avail loans of your choice. Many lenders even boast off to extend the financial assistance instantly (within a minute) too! The service and processing is as hassle free as it can get today.

Although the channels for borrowing have mushroomed to abridge the walls between lenders and borrowers, the basic rules for applying a loan are broadly the same. You should never borrow more than what you need; and ensure loan affordability at the same time. Here is a quick list to state 5 absolute rules for choosing a right loan so that you are never enslaved by a debt in your lifetime.

1. Borrow according to your repayment capacity

Whether you are a Christian or not, it is not about a belief in faith; it is pragmatic to not borrow beyond your means. Always raise a loan after assessing your repayment capacity. Borrowing more than permissible credit limit or borrowing more than 50 per cent of your income hurts your credit score and credit worth.

In the present time it is not uncommon to borrow despite a low score as a lot of loan offers are always available. Irrespective of loan availability you must strictly borrow if you need one.

2. Try to borrow for short-term; do not borrow for longer term unnecessarily

While it always advisable to ensure the affordability or ease of payment of the loans, you must at the same time ensure that you are not extending the payment duration simply to keep the instalments low. For, larger would be the tenure; greater would be the cost of loan. While raising a loan you must try to save as much on the loan interest as possible. In case you have temporary fund hassles, you can begin the loan with small instalments; and later on, either prepay or refinance the loan to save the additional payment of loan interest amount.

3. Be disciplined in loan repayments

One of the most common reasons to destroy one’s credit score is to delay the credit bill repayments. A lot of people realise the mistake after a loan rejection. It is thus advisable that the sooner you automate the loan repayments and credit bills the better it is for your credit health. Also you may deliberately align the same repayment date for a number of accounts so that there are lesser hassles to manage the repayment date. Always keep in mind: A single day delay is same as a week’s delay. It is thus important to pay before the deadline lapses.

4. Try not to borrow for investment or unaccounted risks

Loans should not be directed to pay for investments or volatile risky payouts. For, it is a liability that must be returned on time with loan interest amount. So loans are not meant to fund your fixed deposits or equity funds. Also, it is important to think critically about the loan purpose as a debt should always be used for significant reasons in life.

5. Keep a tab on your credit report

Once you apply for a loan, it is important to keep a strict vigil on your credit report. You must look for ways to increase your score. In case you are running a rolled over credit bill for a few months, you must first of all clear the balance on this card. It would save enough on the interest component.

Similarly if you have multiple loans running simultaneously consider consolidating your debts and reduce your monthly debt burden. Herein you can also consider using an experienced loan broker’s advice to use cheaper loan alternatives such as a secured loan against property or a homeowner loan to reduce your monthly debt repayment burden.

Keeping all these factors in mind, as you assess your credit health and apply with confidence, your loan application is bound to be accepted, making you a boss of your own financial decisions!

Being self employed you ought to be a better manager for plain sailing your business or service. You need to be the one who thinks clearly, objectively and loves to stay ordered and disciplined. However the more conscientious you are, the more grappled you could be with distractions all around.

Whether you are working as a freelancer or a part time worker, it is important to be financially prudent and manage your funds properly. For you singly need to manage the cash flow to work peacefully with all the stakeholders including suppliers, co workers, business partners and customers. Despite the issues or delay in payments you would need adequate annual funding for your personal as well as future business planning expenses.

To beself employed requires a lot of mettle and hard work. Here are some credit management tips to help you stay financially happy all the times. With too many things to manage, it would be wise of you to have a predefined plan for credit management.

Positive Cash flow

Cash is the king for running any business. And in the modern times, cash is not only the one you have as paper or plastic bills in your pocket, it is your credit worth that defines your real economic power. Most of the self employed individuals find it difficult to borrow at low rate due instable inflow of income.

When you are working as a self-employed business or a freelancer, the income is generally in lump sums and that too in uneven patterns. Many conventional lenders do not lend to self employed people due to this uncertain nature of their income. In the absence of adequate income proof you would remain dependent on private lenders for self employed loans despite having the loan repayment capacity.

Thus it is recommended to have a healthy cash flow all the times and ensure a good credit history to be eligible to borrow from unconventional sources. You can use a professional broker’s advice to assess your loan eligibility.

Estimate expenses

Most home based startups fail due to constrained estimates of expenses. Although your start up cost could be less due to your already set workplace at home, the operational expenses would not be as economical as the initial costs. Prepare a modest list of expenses before you begin the self employed business.

Learn to Keep balance

When you do not earn constantly month-to-month it is important to keep a balance to meet the shortfall on the dry income days. You need to save or keep aside funds to supplement money evenly throughout the year.

Limit the use of credit cards

Credit cards attract higher interest rate and charges. When you need quick money to fund a business plan you should consider applying for a small business loan for self employed instead. In face of shortage of available credit options, consider contacting a loan broker online. As you contact a loan adviser online, they will search all the available deals without any brokering fees.

Pay Taxes and Keep records

Most self employed people fail to raise loans due to lack of proof of their business age and income source. Paying regular taxes not only provide you a solid proof of your existence but also highlight your regular income. You should always keep copy of bills and receipts. Use professional help if you find it difficult to manage track of your expenses and income. Do not forget to use insurance and other tax relief investment opportunities.

Maria Smith is a financial advisor at Best Short Term Loans. She has majored in Debt and Credit Management and has been serving FinTech industry for the past five years. Currently she writes articles and blogs for borrowers struggling to avail personal loans with poor credit.